Brazilian regulator warns sin tax is “bad news” for the industry

Brazil’s Secretariat of Prizes and Bets (SPA) president, Regis Dudena, has warned the industry that Brazil’s selective tax will be “bad news”.

Midway through December, Brazil’s lower house approved Complementary Law Project PL 68/2024, which would come into effect from 2026.

Also known as the sin tax or selective tax, it is aimed at products deemed harmful to the population – such as alcohol, tobacco and gambling.

There are also concerns that the Brazilian government may look to back date any tax to 2018 when sports betting legislation was first approved by the National Congress.

Despite the regulated market only launching on 1 January 2025, and with no decision yet to be made on how much the levy would cost the industry, Dudena commented on the tax during a panel session at ICE.

Dudena said it will be important to understand how it would affect the regulated market and whether it would lead to a healthy industry.

He said: “We are passing through a tax policy reform in Brazil in order to simplify what we have here.

“But the, so to say, bad news for the industry is with his simplification of the tax policy, we have what we are calling the selective tax – a tax associated with things like alcohol and gambling.

“It is probable to expect that there will be more than this kind of tax.

“The challenge here is first dealing with the past, for the state to deal with tax that needed to be paid and wasn’t.

“The next step is to understand how this will have an impact on regulation, in order to give some kind of feedback to our congress and to our government, to see if this system that we have there was good enough to make this industry grow healthily and sustainably.”

Brazil’s regulated market launched at the start of 2025 with 66 approved operators and a 12.5% GGR tax rate for licence holders.

Operators that were awarded definitive licences include Superbet, BetMGM and local firms KTO Group and Betnacional, while Betsson, Stake, Betano and bet365 were handed provisional authorisation. 

EGR recently explored in depth the opportunities and challenges the market faces.

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 Selective tax set to be introduced in 2026 that would also call for backdated payments, as SPA chief says talks will be held with government around market growth assurances
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